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Quest Means Business

US Announces New COVID Rules For Travelers From China; Goldman Sachs: US Will Avoid Recession In 2023; Southwest Airlines Cancels 2,500 Flights Wednesday; Pope Francis Asks For Prayers For Pope Emeritus Benedict; Zelenskyy Adviser Against Trusting Russia's Interest In Peace Talks; World Of Wonder: Vienna. Aired 3-4p ET

Aired December 28, 2022 - 15:00   ET



PAULA NEWTON, CNN INTERNATIONAL HOST: Another losing day on Wall Street this Wednesday, but let's face the facts, most traders have closed the

books on 2022, and as you can see there, steep losses. The Dow losing more than 200 points, the NASDAQ heavy, even worse this hour.

Those are the markets, and these are the main events. The US will begin requiring travelers from China to show a negative COVID test before flying.

Goldman Sachs predicts the US economy will avoid a recession in 2023.

And yes, what a difference a year makes, especially if you are that guy, Elon Musk.

Live from Atlanta, it is Wednesday, December 28th. I'm Paula Newton, in for Richard Quest and this is QUEST MEANS BUSINESS.

And we have breaking news for you tonight, the US has announced new restrictions on travelers from China and it follows concerns about China's

spike in COVID cases and Beijing's lack of transparency about the numbers.

Starting next week, the US will require all travelers from China to show a negative COVID test before flying. We want to get right to our news here

with Dr. Jonathan Reiner of George Washington University. He is a CNN medical analyst. And yes, this is deja vu. It is happening in another part

of the world, though here, Dr. Reiner, and yet some of the issues completely the same.

I want to ask you, in terms of this US response, do you think it is driven by sound public health policy? Or is there more fear because there is so

little transparency in China, about the cases and any variants that are spreading?

DR. JONATHAN REINER, CNN MEDICAL ANALYST: Well, I think it's probably a little bit of both, but there's a role for some of these restrictive travel

policies, but almost all of them are at the very beginning of a pandemic.

So you know, new infections spreading around the world, if you're trying to build testing capacity, you know, build hospital bed capacity and trying to

buy time, some of these restrictive travel policies can perhaps buy you a little bit of time. And they might have done that in the late winter and

early spring of 2020.

But this virus is all around the world, and the predominant strains that are circulating in China right now are circulating all around the world,

including the United States.

So I think this concept of trying to test passengers before they come to the United States is really just a false sense of security. I call it like

locking a screen door, you think you're preventing an intruder, but it is really very minimal security.

NEWTON: And I hear you. We've heard that, in fact, from you throughout this pandemic about the fact that you're only buying a little bit of time.

Having said that, what tools does the CDC or the WHO have at their disposal to really get that information to China that is not forthcoming, right,

like how many people have been infected, but crucially, the kind of variants that they're dealing with?

REINER: Well, I think we have very limited -- we have very limited tools, and the World Health Organization has been sort of our link to places like

China. But the ability of the WHO to get this kind of information is completely dependent on the cooperation of the Chinese government.

This is what we know about the surge -- the massive surge in China right now. We know that it is spreading very, very rapidly. Estimates are that

perhaps a quarter of a billion people in China contracted the virus in December alone. Estimates are that, you know perhaps 800 million people

ultimately in China will contract COVID before this surge is over, sometime in the next two to three months.

And although we think the overall case fatality rate from the strains of this virus that are circulating now a relatively low, a relatively low

number multiplied by a massive number is an unacceptably high mortality rate and the Chinese are potentially looking at anywhere between half a

million and a million deaths over the next few months unless they are able to contain this.


NEWTON: Yes, and not to mention the strain on its healthcare system, which can obviously impair their ability to treat all other kinds of illness.

I want to ask you directly, though, how worried are you when you see this about other variants emerging, which will mean more trouble for the entire


REINER: I'm worried about -- I'm worried about that in every country. In the United States, we also don't have a great handle on how many cases are

being transmitted every day. We only know the numbers that are reported. And as you know, the vast majority of infections in the United States are

found via at-home testing, none of which are reported to the CDC or central authority. So we have no idea how many cases are actually occurring in the

United States or in most parts of the world.

But what we do know for sure is, the longer this pandemic persists and the more people become infected, the greater is the opportunity for variants

with even more rapid transmission profiles, or more immune escape capacity to propagate.

So the way to -- you know, the way to prevent variants from forming is to prevent people from becoming infected. But we've lost some of the will to

do that. One of the ways that you can do that in the United States and in Western Europe and other parts of the world is to bring back mitigation

strategies that have been unpopular, like masking, but we simply don't want to do that.

I'm sorry, go ahead.

NEWTON: Yes, and now we have no mitigation strategies as well in China, it seems as they moved away from Zero COVID.

Dr. Reiner, again, a sense of deja vu here, but we really thank you for your expertise, as always.

Now, for more on this announcement, we want to bring on our White House reporter, Kevin Liptak. He is on the island of St. Croix, where President

Biden is on Holiday this week. And of course, as we've learned, Kevin, never a Holiday for COVID.

These are significant announcements, right? I mean, the US feeling that it had no choice, I mean, give us a read on what they've done here and the

kind of difference it will make.

KEVIN LIPTAK, CNN WHITE HOUSE REPORTER: Yes, and I think that the main concern that you hear from Federal health officials is not necessarily that

the surge is happening, but they aren't getting a lot of information from the Chinese government about what the data looks like if there even is data

about genome sequencing, about what strains could potentially be circulating in China and that is really what has led to today's

announcement that they will require a negative COVID test for passengers coming from China to the United States at least two days before their


They will have to show that to the airline before they get on the flight. It can be a PCR test. It can also be an at-home antigen test that is

administered by a telehealth service, and it will be in effect for people flying directly from China to the United States, but it will also apply for

passengers who transit through three different cities, whether it's Seoul, Toronto, or Vancouver, those are all popular transit points for people

coming from China to the United States.

And what Federal Health officials say is that this will remain into effect until they have a better handle on what's going on, on the ground there,

and that concern about the potential strain is a serious concern. The US has set up genome sequencing centers here to try and track what new strains

might be potentially circulating in the United States.

But of course, if you don't do that in other countries, there is the potential that they could spread without the awareness around of the

American government about what they could potentially do to mitigate that.

I think this all really does speak to the mistrust between Washington and Beijing specifically, when it comes to this issue of COVID. That has been

true since the beginning of the pandemic early in 2020. The US has said that China hasn't necessarily been forthcoming enough about the origins of

COVID. And now, they are saying that China isn't being forthcoming enough about its current surge.

And so, this will remain into effect at least for the duration. It starts about a week from tomorrow on January 5th.

Now the Chinese government had responded earlier to reports that this may be in the works, saying that the US, China, and other countries need to

work together to help the global economy rebound. So certainly it will be interesting to see how Beijing responds to this.

The US is not the only country or the first country to apply these requirements. Japan, India have also done the same. So it does seem like

we're entering sort of a new era of these travel restrictions at least when it comes to China after all of them had been lifted over the last year, and

so this is certainly a new phase in the US attempts to try and mitigate the spread here.


NEWTON: Yes, Kevin, and as our Dr. Reiner was saying, this is only going to buy some time, it won't solve the problem entirely as you know, infections

spread rapidly in China.

Kevin, I really want to thank you for getting on top of this breaking news for us. Appreciate it.

Now, Goldman Sachs is making a bold prediction for 2023 that the US in fact will avoid a recession. Its analysts see the economy making a soft landing,

did I say that well enough? Soft landing -- as the shock of higher rates fades and slower growth eases job growth and inflation.

The projections for Europe, yes, they are a lot less optimistic. "The Financial Times" polled 37 economists and the vast majority think the

Eurozone is already in fact, in recession.

Megan Greene is the Global Chief Economist at Kroll. She joins me now from San Francisco, and I'm glad to have you weigh in here as we put 2022 in the


And now I want to quote you, right? You said this may be the most anticipated recession in history, and yet it may not happen. So weigh in

here. What do you think?

MEGAN GREENE, GLOBAL CHIEF ECONOMIST, KROLL: Yes, you know, it's not impossible that Goldman Sachs is right, and that the Fed does manage to

engineer a soft landing, I just think it's also not very likely.

If you think about it, rates in the US were zero percent at the beginning of this year. So there has been an incredibly aggressive rate tightening

cycle. There are a bunch of economic indicators suggesting that we're not only slowing down, we are heading towards a recession.

So if you look at the survey data, confidence data, PMI data, if you look at the yield curve, it is deeply inverted. That will suggest the recession

is coming. What has held up really well is consumption and consumption accounts for about 70 percent of our growth in the US, and that's partly

because there is a huge cash cushion among consumers and among corporates.

It is also because the labor market has held up really well, and so the Fed is really hoping that what will happen is it will whittle down job

openings, and that the labor market won't deteriorate that much and we can avoid a recession.

If you look at the data around past recessions, though, that's a great theory. It's just literally never happened before. So I think if we do get

a deterioration in the labor market, people will really pull back on that spending and that is when a recession will hit, I think probably sometime

around the middle in the second half of next year.

NEWTON: Yes, it is those unpredictable things that we thought we knew the script here, and then the economy doesn't follow it. I want to ask you a

really crucial question, though. Is it possible for the Fed to hit its inflation target without a recession?

GREENE: Yes, it is possible, it's just very unlikely. If you look at the history of Fed rate hiking cycles, they have managed to achieve a soft

landing, I think twice ever in history. So it's really unlikely.

Generally, the Fed pitches the economy into recession, it's because monetary policy kicks in with such incredible lags, and there are really

blunt tools that the Fed has to work with. So it's really hard to engineer a so-called soft landing while hitting the inflation target of around two

percent perfectly, and it makes it really unlikely that the Fed is going to pull this off.

NEWTON: Yes, especially because Jay Powell has been categorical, right? He is looking at the data, and he wants that inflation number to get to where

he wants it to be, and he will not take any compromise on it.

I want to move to Europe. We were just talking about the FT survey saying that 90 percent, right, of economists are saying, look, there is going to

be a recession in Europe in 2023. So if we accept that, it seems what is more worrying now is a protracted recession, maybe even going to 2024.

I mean, what do you see when you see that European economy?

GREENE: Yes, I think much of Europe is probably already in the beginning of a recession. We know that the UK almost certainly is. Germany and Italy are

probably also already in contraction. The hope is that it is a short and shallow recession.

But Europe is disproportionately hit by the war in Ukraine. Energy costs are much higher in Europe than they are in the US, the cost of living

crisis is even higher.

A lot of economies in Europe are over leveraged already, so don't have that much room to intervene and protect the vulnerable in society. And the

banks, I think, are in a weaker state in Europe than in the US.

So there is a risk that you end up seeing financial market blowouts, as the ECB and the Bank of England are withdrawing accommodation, and then you

risk getting a financial crisis on top of a plain vanilla recession and that would make the recession a lot deeper and a lot longer.

So it's not impossible, that will happen. It's not my base case, either. I think what we probably will see is a shorter, shallower recession this time

around than what we've seen in the past, but there of course risks that it could be longer and deeper.

NEWTON: Sounds good. noted. We'll put you down as a little bit more optimistic in that category for 2023 as well and Happy New Year to you,

Miss Greene. I appreciate your expertise here.


Now after the break, Southwest Airlines canceled another 2,500 flights just today. Outdated software may be to blame for a slow recovery from last

week's storm.


NEWTON: Southwest canceled 2,500 more flights today as the airline's meltdown attracts increased scrutiny. The weather-related cancellations and

delays not all weather related I want to remind you, are apparently linked to outdated equipment.

The President of the Airlines Pilots Union told CNN that Southwest operations haven't changed since the 1990s. The Department of

Transportation is investigating and US Transportation Secretary Pete Buttigieg vowed to hold Southwest accountable. Listen.


PETE BUTTIGIEG, US SECRETARY OF TRANSPORTATION: Their system really has completely melted down and I've made clear that our department will be

holding them accountable for their responsibilities to customers, both to get them through this situation and to make sure that this can't happen


We all understand when you have a major historic storm hitting the system and hitting hubs in every part of the country, we know that that is going

to have an effect on the aviation system, but what is really concerning here is that while all of the other parts of the aviation system had been

moving toward recovery, and getting better each day, it has actually been moving the opposite direction with this airline.


NEWTON: You can say that again. Rahel Solomon has been following all of this for us. She is in New York, yes, contrition is not going to cut it

here, right, it doesn't matter. Tens of thousands still dealing with this nightmare.

But I want to ask you, will a government investigation actually help?

RAHEL SOLOMON, CNN BUSINESS CORRESPONDENT: It's a great question. I mean, perhaps in the future in terms of incentivizing Southwest and perhaps some

of the other airlines to make the necessary upgrades so that something like this doesn't happen again. In this case, it was Southwest, perhaps putting

a bit more pressure on the airline to make these upgrades that the company CEO admitted last night, Paula, that they really need to double down in

terms of finally getting to those upgrades.

As one analyst put it to me today, the company essentially outgrew that system, right? This is a system that according to the Pilots Union, they

have been operating and working with since the 1990s. Paula, that's when we were still walking around with CD players and headphones and using floppy

disks just to put this in perspective.

And take a look at the impact to the stock as investors really come to terms with the fact that this might be a costly process. Southwest Airlines

right-sizing its operations as you can see. Shares have sort of -- the losses have accelerated through the day.

We are now looking at about 4.6 percent. Add that, Paula, to the nearly six percent loss Southwest Airlines experienced yesterday. Over the last week

or so, they are off about 12 percent.


So what's going to cost so much for Southwest Airlines? Well, to pick one, you know, choose your thing. So the first thing is reimbursing all of these

travelers. We're talking about 15,000 flights -- more than 15,000 flights over the last week or so, reimbursing travelers who don't want to rebook

with Southwest, they just want their money back.

Also paying all of these employees who have had to work the phones, work reservation systems, and then again, those upgrade systems. So this is

going to be a process that will likely drag on and will likely also be a drag for the shares.

NEWTON: Yes, and Rahel, I want to make clear, I was walking around with the floppy disks and the cassette recorder, not you, just saying.

SOLOMON: As was I, actually.

NEWTON: It is extraordinary when you think about it really. Could you even call it a computer system in the 90s. I want to ask you quickly, though, I

mean, are we looking -- what's the total price tag here?

SOLOMON: Okay, so to put this in perspective, I spoke to an aviation analyst who put this sort of in dollars and cents for me. So he says,

you're looking at about a million customers, right ballpark, if an average ticket is $250.00 to $300.00. That suggests the upper limit in terms of

exposure. It is $250 to $300 million in terms of absolute value.

The question is how they defray that, that being in terms of how many tickets can they get? How many people can they convince to hold on to their

ticket and just rebook rather than sort of insist on the cash refunds? And in terms of the software upgrades, Paula, I'm told that that could be

easily $100 million to upgrade those scheduling systems. Southwest, of course, the largest US domestic carrier.

So this is going to be an expensive mess to clean up for Southwest for sure.

NEWTON: Yes, and I know a lot of people, travelers, actually who are rooting for this airline. It was a favorite before this happened, really.

So we'll continue to keep track of what happens with it through the Holiday season and beyond.

Rahel Solomon, thanks for that and glad you're not on a Southwest flight or in an airport. Appreciate it.

SOLOMON: Me, too.

NEWTON: Now Tesla shares have rebounded well over a percent after yesterday's steep decline. It is only a percent though, 2022, look at it

there. It hasn't been kind to Tesla shareholders, unfortunately.

Shares have fallen 70 percent since the year began, and there is plenty of reasons why, I don't have to remind you including though the crowding

electric vehicle market.

There is also CEO, Elon Musk, his Twitter purchase and erratic behavior has spooked investors somewhat. Criticism has been fierce. In "The New York

Times," Paul Krugman wrote that Musk is genuinely brilliant or maybe in some respects, but an utter fool in others.

2021's Time Person of the Year, I'll remind you, he spent 2022 hurting his reputation as a so-called tech genius. There was of course Musk's deal in

April to take Twitter private. After trying to back out, he did take that deal in November.

Musk immediately cut half its workforce, and has been criticized for his approach to moderation. Now, he is saying he's looking for a new Chief


Richard Quest sat down with Clare Duffy to discuss that.


RICHARD QUEST, CNN INTERNATIONAL HOST: That's Elon Musk. That's Twitter. This was a story that frankly, you couldn't write, you couldn't invent. It

was so extraordinary.

He wants to buy it. He tries to get out of buying it, he ends up buying, and it's a mess.

How do you square the circle?

CLARE DUFFY, CNN BUSINESS WRITER: I mean, it has really been such an interesting year of following the story. You know, it is something that

Musk had actually sort of joked about and talked about for a long time prior to this year, but I don't know that anybody really expected him to

just go ahead and do it and to offer so much money to buy Twitter.

I think that was ultimately the reason why he tried to get out of it. I think he did want to own the platform, but realized that he was going to be

spending way more than the company was really worth to buy Twitter, but he didn't get out of it.

And now, you know, it has blown up now. There are so many questions about what's going to happen to this really crucial platform.

QUEST: Now, let me challenge you. Why is it crucial? What is crucial about a social network?

DUFFY: I think what is crucial about Twitter is that, you know, despite the fact that it is smaller than some of its other social media peers, it

remains this really sort of central place for people to get and to share news, and where journalists and politicians and academics, people who are

really important in this sort of communication space.

QUEST: So really, it is an agency in the sense that, you know, somebody dies and I suddenly see 15 different quotes about Twitter -- on Twitter. If

somebody wants to make an announcement, they do it on Twitter.

DUFFY: Exactly. And in that way, it is really important for the information there to be reliable, to be able to sort of suss out what's

real and what's not, because so many people who are sort of elevating conversations and making news are getting it from Twitter, putting it on



QUEST: Is Musk's administration of Twitter just eccentric or is there something deficient?

DUFFY: I think that's the big question at this point, like does he have a plan? Or is he just sort of flying by the seat of his pants and trying to

cut costs? I mean, I think the big thing that he's doing right now is trying to cut costs because he has taken a lot of debt to buy this company

and those debt payments are going to come due. I think that is kind of what we're seeing right now, but will he be able to sort of turn things around

and really turn Twitter? It has not ever been a very good business, and so I think the big question is whether he'll be able to make that happen.

QUEST: Right. But related to that is this whole free speech issue and we saw it only just at the end of December, with banning this account from the

guy who follows his private plane to allowing Donald Trump back on again. There is no seemingly coherent, consistent policy.

DUFFY: Right. And that, you know, it is interesting, because he came in talking about wanting to make it a free speech absolutist platform and

criticizing Twitter's former leadership for the decisions that they've made, and yet we're seeing him make these sort of one off choices about who

to let back on who to take off. And there is no -- as you said, there's no sort of transparency about what's happening there and it sort of calls into

question this free speech idea that he has planned that he has for the platform.

QUEST: Finally, there's no real Board of Directors or Board. There Is no, the Monitoring Board is gone. He owns the lot. So one suggests, it is

the regulators, particularly in Europe, who will be the ones who finally say, knock on the door, Mr. Musk, your time, we will need to talk to you.

DUFFY: Exactly. In January, Twitter is supposed to have sort of a test case of whether or not it's going to be able to be in line with the new

Digital Services Act in the EU. That will be a big, you know, sort of moment of truth for Musk and Twitter, I think.

And, you know, US regulators could take some action as well. I think it will be interesting to see whether Musk's sort of courting of the right

will help him when there is a Republican House next year, or whether you know, lawmakers will decide that he is too powerful in his leading of this


QUEST: Have you enjoyed covering it?

DUFFY: It has not been boring.


NEWTON: Our thanks there to Richard and Clare Duffy.

Now, in today's Connecting Africa, this year's COP 27 was a chance for the world to debate the climate crisis. One of the debates to emerge from that

summit is how to follow climate friendly agenda on a continent that is suffering from energy poverty and still needs to industrialize.

The Africa Finance Corporation is engaged in climate friendly policies and acknowledges that industrializing without fossil fuels, remains a major




should also be cognizant of the reality we are in in Africa. Half of the population doesn't have access to power, and we export most of the raw

materials. So the two things that have to happen is providing access to power through baseload and baseload is usually either hydro or gas. So gas

is still very important and we have abundance of gas in Africa, but also industrialization.

So, if you think about climate change, this covers a number of things, including carbon emissions, renewable power, and battery metals. Africa has

30 to 40 percent of all battery metals in the world.

ELENI GIOKOS, CNN INTERNATIONAL CORRESPONDENT: The question then comes, can the continents build efficient processing plants for the raw materials that

you speak of? Because that has been one of the arguments -- there is huge investment, it means that we have to do it in a most efficient manner, that

we'll be able to plug into international markets.

SHENOUDA: Definitely it can, but it will happen over time.

The other thing that is very important, and this is what we are focused on is that a lot of these products are mined in the middle of nowhere.

So you need to build the infrastructure to move it from the mine to an industrial zone, so we invest in rail, we invest in roads so that the

product is transported and then we invest in Special Economic Zones so that we upgrade to be industrialized, and then we also invest in ports so that

these products are exported.

GIOKOS: How do we scale up and mobilize and catalyze access to electricity?

SHENOUDA: We are a DFI, but we are also a commercial player. The key thing is to send the message very clearly through investing in projects and this

is what we've been doing. And the projects could be either climate friendly or renewables, et cetera.

But the key thing is, let's look at what resources we have and what can we do with them.


NEWTON: All right, still to come for us, prayers for former Pope Benedict. The Vatican says a 95-year-old is very ill and his health has declined in

just the past few hours. We will have an update.




NEWTON: Right so come for us (ph) prayers for former Pope Benedict. The Vatican says the 95 year-old is very ill and his health has declined in

just the past few hours. We'll have an update.




NEWTON: Pope Francis says his predecessor needs prayers for God to console him until the very end. The Vatican says the health of Pope Emeritus

Benedict is deteriorating due to his advanced age. He says doctors are carefully watching the former pontiff, who is now 95 years old.

In 2013, Benedict became the first Roman Catholic pope in nearly 600 years to step down. CNN's Delia Gallagher is following developments from Rome.

It is extraordinary, right?

The fact that we learned this information directly from the pope himself.

DELIA GALLAGHER, CNN VATICAN CORRESPONDENT: That's right, Paula. The Vatican has been abuzz all day with this news but it was Pope Francis

himself that started it this morning at his general audience when he asked for prayers and said the pope emeritus was very ill. Here is a look at what

we know so far about the situation.


GALLAGHER (voice-over): Prayers for a pope in failing health. In his globally broadcast general audience, Pope Francis called on the faithful to

pray for his predecessor, Pope Emeritus Benedict as his health deteriorates.


POPE FRANCIS, PONTIFF, ROMAN CATHOLIC CHURCH (through translator): I want to ask you all for a special prayer for Pope Emeritus Benedict, who

sustains the church in his silence. He is very sick. We ask the Lord to console and sustain him in this witness of love for the church to the very



GALLAGHER (voice-over): The Vatican says the 95-year-old's health has deteriorated due to the advancement of his age and that he is being

continually monitored by his doctors.

Once the head of the Roman Catholic Church, Pope Benedict XVI has been living alongside his successor at the Vatican.


After making the almost unprecedented decision to resign in 2013.

Announcing that decision, Benedict's said his choice to step down was made due to his lack of strength of body and mind.

POPE BENEDICT XVI, EMERITUS: I will ask each of you to pray for me and for the new pope.

GALLAGHER (voice-over): With that new resignation, Pope Benedict came the first pope to step down in nearly 600 years but retained his title and

continued to dress in the papal white and make occasional public appearances.

Born Joseph Aloysius Ratzinger in Germany, in a childhood spent under the shadow of Hitler's Nazi regime, Pope Benedict XVI has sometimes been a

divisive figure, unflatteringly referred to as God's Rottweiler in his conservative defense of the faith.

He was cardinal and pope during the years when the Catholic Church's sex abuse scandals came to light and he spearheaded the Vatican's efforts

toward a zero tolerance policy.

However, after his retirement, he suffered a reputational blow when the church commission report found he knew and failed to act against a

pedophile priest while he was archbishop in Munich 40 years ago.

Benedict denied the allegations. Even after his resignation, he continues to be a towering figure in the Catholic Church. And as his health declines,

there will be many sending him their thoughts and prayers.


GALLAGHER: Paula, the Vatican did tell us that Pope Francis, after that general audience, went to visit the pope emeritus, who, of course, lives in

a monastery just behind St. Peter's Basilica there in the Vatican. No further updates at the moment, Paula.

We are standing by because, of course, it is very unusual for the Vatican to come out and indeed the pope to publicly comment on the pope emeritus'

health. We will bring you any further updates as we get them. Paula.

NEWTON: I really appreciate you being on the story, no doubt why the pope felt it was time to call everyone to pray, as he felt the pope emeritus was

in the last moments of his life. Delia, thank you so much, I appreciate it.

Now Ukraine's withstanding near constant attacks from Russia Wednesday. The recently liberated city of Kherson has been hit multiple times. That is

over the past day alone. Ukrainian officials are now calling on residents there to evacuate immediately. Will Ripley brings us the latest on

Ukraine's winter of pain and sorrow.


WILL RIPLEY, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice-over): So many tears for yet another victim of Russia's war in Ukraine.

Mourners in Kyiv are paying their final respects to a fallen Ukrainian soldier, a husband, brother and son. He was reportedly killed near Bakhmut.

Intense fighting has the city almost unrecognizable. Debris litters the streets. Buildings are on fire.

OLEKSANDR, BAKHMUT RESIDENT: Our house is destroyed. There's a shop near a building now it's not there anymore.

RIPLEY (voice-over): In this besieged city across the country, millions are still living without power. Ukraine accuses Russia of persistently

targeting Ukrainian energy facilities, giving engineers little time to repair the grids before the next strike comes. Ukraine's Energy Minister

describes the situation across his country as really difficult.

Strikes have left Ukraine with a power deficit, unable to meet the basic energy needs of the country. Fears are growing among Ukrainian officials.

Moscow could be planning large strikes around New Year's Day. In this small village near Kherson people are bracing for a bitterly cold winter, a

winter without power, collecting firewood and other supplies to protect against plummeting temperatures.

UNIDENTIFIED FEMALE: We will get through the winter because we fix the chimney and now we can heat the house. We will get through it. We do not

have any other option. Where would we go?

RIPLEY (voice-over): On top of all this a war of words brewing between Moscow and Kyiv. Russia's Foreign Minister Sergei Lavrov is issuing an

ultimatum. Ukraine must battle Russia's demands; including giving up occupied Ukrainian territories or else the Russian army will take matters

into its own hands.

Ukraine's President Volodymyr Zelenskyy says that won't happen. He's vowing to retake all captured Ukrainian ground. Diplomatic negotiations seem just

as gridlocked as the battlefield. Little sign of peace coming this holiday season and a conflict that continues to grind on.


Will Ripley, CNN, Lviv, Ukraine.


NEWTON: Quick check to the markets. We are almost done in 2022. A lot of traders want to see the backside of it. Look at that, we are almost down 1

percent. The other indices not doing any much better, all down about 1 percent as you can see for today.

As usual, the Nasdaq is leading the way. The tech heavy Nasdaq, down on the tech heavy sector.

That is QUEST MEANS BUSINESS for now. I will be back at the top of the hour as we make our dash for the closing bell. Up next, "QUEST'S WORLD OF







RICHARD QUEST, CNN HOST (voice-over): The waltzes of Strauss, the music I've loved ever since my parents gave me the first vinyl record. I was 7,

it was Strauss waltzes. It is music to lift the heart, like this city, sophisticated, fun.

THOMAS SCHAFER-ELMAYER, VIENNESE WALTZ EXPERT: This lady is Sara, she is one of the assistants.

QUEST: We ask for your forgiveness.


QUEST: Before we even begin.

The famed Kursalon, where Strauss once played, is where I am having my waltz lesson.

Before Sara takes over, I need Thomas Schafer-Elmayer to give me the right pointers before I do any damage.

I will confess, I have dabbled in ballroom dancing before, nothing grand, mind, no "Dancing with the Stars." I do know enough to follow the line of



(voice-over): And yet, a Viennese waltz has a lot of turns and spins.

I'm getting dizzy.

SCHAFER-ELMAYER: That's because you did not dance enough. Sailors don't get seasick.

QUEST (voice-over): Mr. Schafer-Elmayer is not only teaching me the steps but the etiquette.

I'm really surprised at just the level of dizziness.

Both instructor and dance partner are patient walking me through this formal dance.

The waltz is part of Viennese society. Every year, dozens of balls are held.

Why are people terrified at the Viennese waltz, versus an English waltz or U.S. waltz?

SCHAFER-ELMAYER: With the Viennese waltz, you have always the same follow of sequence of steps there. So the only thing, it's very fast.

QUEST: With all these balls being held every year, Thomas' dance schools prepares young Austrians for one of the most important events of the


SCHAFER-ELMAYER: About 450 a year in Vienna, some of them are very big balls, with up to 7,000 guests. And others are very small balls with about

100-200 guests. But they all count as a ball because there is always an opening ceremony with the debutantes.

QUEST: I can hear people say, debutantes?

What world are they living in?

SCHAFER-ELMAYER: They are debutantes. They have never before opened a ball and that's why they are debutantes.

Not only for us here in Vienna, it's for everybody.

QUEST: I clearly will never be a debutante to open a ball. But for the music for my dancing, I want "The Blue Danube."

SCHAFER-ELMAYER: It's the speed that you need.

QUEST: The truth is, you are moving so fast round and round, that you feel quite elated.

Dancing the Viennese waltz to "The Blue Danube," in Vienna --

SCHAFER-ELMAYER: Forward, side, close.

QUEST: -- it's a dream come true. I'm enjoying being swept along, even though I'm not very good and my poor partner's toes are twinging.

UDO ZWOLFER, LEAD VIOLINIST, SOUND OF VIENNA: It is a music full of high energy and it has deep despair and unbelievable joy.

QUEST: "The Blue Danube," the violinist Udo Zwolfer has spent a lifetime mastering Strauss and this particular piece of music.

QUEST: How many times have you played "The Blue Danube"?

ZWOLFER: Thousands.

QUEST: Do you get tired of playing it?

ZWOLFER: No, never. It's flowing through me and my fellow musicians. We can feel the audience begin to relax, to forget the problems.

QUEST: It is hard not to become intoxicated by these waltzes. I don't think I could ever get tired of listening to Strauss, swaying along, even

if I'm only tapping me feet.





QUEST (voice-over): Be on your guard, there's something wicked coming this way.

It is the town of Burg Wien (ph), just outside Salzburg. The children sounding the warning, the Perchten Run is about to begin.

It sounds and looks terrifying and the smell, (INAUDIBLE). They are known as the perfect -- or don't get confused with the Krampus. Either way, this

is an Austrian tradition that goes back centuries.

But don't be scared. The Perchten are here to drive out the dark of winter. Spring will be born, as a result. First, we must be lashed by the goat's

hair whip and, yes, it's a sign of good luck. The spirits will no longer haunt you. This is the piece de resistance of a process that began about an

hour ago.

The Fishak (ph) of Perchten group allowed me to join them as they prepared for tonight's run. And Verena of course, fresh us from our Christkindlmarkt

is joining me and is my guide to this very strange business.

VERENA ALTENBERGER, ACTRESS: You can see it, you can hear it. You smell the sheep, the fur and everything. And this reminds me so much of my


QUEST: Really?

ALTENBERGER: That's why I'm so excited.

QUEST (voice-over): This group is lovingly keeping the tradition alive. They're making sure future generations appreciate the love of the Perchten.

Look at this.


It's all right, I got quite carried away.


The noise is really like a cacophony of (ph) sound.

I am still a little confused.

What is the difference between Krampus and (INAUDIBLE)?


UNIDENTIFIED MALE: This is the Perchten.

QUEST: What's the difference?



QUEST: These goody bags?

UNIDENTIFIED MALE: Or two are good. We are good.


QUEST: -- and I'm not about to argue with a man carrying a mask that's got loads of prongs and horns on it.

What's the purpose of it all?

ALTENBERGER: All the darkness and the bad energy will be sent away.

QUEST: It's almost showtime. If you think it's ghoulish and scary, you'd be right. And the children love it. From that moment when they are first

just a little bit frightened, to when they realize the fun and it becomes part of their growing up.

No one is spared the lashings.

ALTENBERGER: Richard, I have a confession to make.

QUEST: Go on.

ALTENBERGER: Through the eyes of CNN, I feel a little bit weird for liking this so much. And I imagine having also snow and sitting in your

grandmother's living room, waiting for them to arrive.

QUEST: What do you make of it?

ALTENBERGER: I feel, honestly, honored that I was allowed to show you so many different traditions and it's like a love that we went to

Christkindlmarkt with a beautiful type tree and now, you have the chaotic wild feast.

QUEST: Are you ready for Christmas now?

I mean, do you feel you've been to a Christkindlmarkt, seen Krampus.

Are you ready?

ALTENBERGER: I am ready for Christmas. Yes, sir.

QUEST: Thank you.

ALTENBERGER: Thank you so much. Happy Christmas.

QUEST: Do not think of this as too scary for kids.


The tinge of fright is what they adore, it is what they remember, it is the Perchten Run of their youth.

Vienna is such a distinguished place. I think the word that best describes it is elegance. From the music to the dancing to the coffee houses, to the

very way of life. And you'll want to come here and enjoy all this elegance for yourself. Elegant Vienna, part of our World of Wonder.




NEWTON: This is your dash to the closing bell. We are two minutes away now.

The U.S. will start requiring travelers from China to test negative from COVID. The averages meantime slid a little farther after that announcement

just an hour ago. You see it there. The Dow down now almost 250 points. Better than 1 percent. It is off its lows though, not by much.

And if you look at the S&P and the Nasdaq, also down by better than 1 percent. Now this I want to say is also the Nasdaq's worst ever December.

Hard to believe but there it is.

I also want to remind you as well about our Goldman Sachs prediction, that the U.S. will dodge the recession in 2023. Many economists think Europe is

in worse shape. Kroll global chief economist Megan Greene says, there are several reasons why. Listen.


MEGAN GREENE, KROLL GLOBAL CHIEF ECONOMIST: Europe is disproportionately hit by the war in Ukraine, energy costs are much higher in Europe than they

are the U.S. The cost of living crisis is even higher. A lot of economies in Europe are over leveraged already.

So they don't have that much room to intervene and protect the vulnerable in society. The banks I think are in a weaker state in Europe than in the

U.S. So there is a risk that you end up seeing financial market blowouts.


NEWTON: So a few notable stocks to tell you about. Southwest Airlines is down 5 percent. As we've been noting, its operations have been stymied by

bad weather. And of, course that old software. Thousands of flights again today canceled.

The Biden administration says it is investigating.

Let's go to Tesla now. As you see they are up better than 3 percent. But it hasn't posted a daily gain in nearly 2 weeks. A reminder, it is still down

70 percent on the year.

And that is your dash to the closing bell. I am Paula Newton. The bell is ringing right now on Wall Street. And then we will take you to "THE LEAD"

with Pamela Brown.